Month: April 2015

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Discount Brokerage Weekly Roundup – April 24, 2015

From parcel delivery to vacuum cleaners to financial management, it seems like robots are here to stay. With the NASDAQ finally breaching its previous all-time high, led there of course by the technology giants, there’s no doubt that robots and gadgets are powering the drive. For many online discount brokerages confronting this brave new world, their choices seem to be either join the party or step off the dance floor. For the moment, at least, it looks like several discount brokerages are willing to dance.

In this week’s roundup we take a look at the latest online brokerage to get connected to a fast growing stock exchange followed by one online brokerage that’s looking to add to its stable of registered account offerings. Following that, we quickly look at the raising of the TFSA contribution limit followed by some interesting action and numbers behind the robo-advisors and what they mean for online brokerages. We cap off the round up with a tour through the upcoming investor education events followed by some interesting lessons from the investor forums.

BMO InvestorLine Connects to the CSE

This past week the Canadian Securities Exchange announced the addition of another Canadian online brokerage, BMO InvestorLine, to its list of brokerages allowing direct trading access and real-time quotes. The list of online brokerages now offering direct trading and real-time quotes to the CSE has now expanded to include all bank-owned Canadian discount brokerages as well as most of the independent Canadian brokerages. Earlier this year, TD Direct Investing became a major addition to that list as well. According to the CSE, Desjardins Online Brokerage is in the process of getting on board. Not yet hooked up to the CSE are Interactive Brokers as well as Jitneytrade. For more information on the brokerages enabling direct online trading and real-time quotes to the CSE, click here.

RDSP Now Available at National Bank Direct Brokerage

Earlier this week, National Bank Direct Brokerage became one of only two Canadian online brokerages (the other is TD Direct Investing) to offer the Registered Disability Savings Plan (RDSP). The RDSP is a registered account that enables individuals who are eligible for the Disability Tax Credit to grow investment income within the plan on a tax-deferred basis.

The information pages for the RDSP on NBDB’s website offers valuable information on the plan, how it works as well as hyperlinks to official government resources on the RDSP.

TFSA Limit Raised

Another registered account that is popular with DIY investors made headlines this week. The Tax Free Savings Account (TFSA) got a big boost by having the maximum contribution amount per year raised to $10,000 from $5500. While there was a substantial hike telegraphed a few weeks ago, the confirmation came in the official budget announcement earlier this week. From a practical standpoint, it appears that financial institutions are already allowing TFSA contributions from Canadians looking to top up their contribution even though the budget has not officially passed through Parliament. For DIY investors, expect to see more in the way of marketing from financial institutions (Questrade is already on it) and media coverage on the TFSA in the weeks to come.

source: Twitter

 

Money Machines

With earnings season in full swing, it was an interesting week looking at the performance of the US online brokerages. While Canadian discount brokerages will almost always lag what the US brokerages are up to, in at least one respect they are not that far behind their counterparts in the US.

While normally we might focus on trading metrics or asset growth, the bigger story emerging out of the financial results has been the impact of robo-advisors to the earnings of Charles Schwab. According to their latest earnings report, Schwab’s ‘robo-advisory’ unit has attracted a staggering $1.5B after just six weeks. And they’re not the only online brokerage taking advantage of the popularity of these robo-advisory models. Interactive Brokers also recently announced their acquisition of Covestor, a firm who lets individuals mirror the trades of other investors actively or passively.

The activity in this space isn’t limited just to the US, however. Already there are signs in Canada that this space is about to explode. Earlier this month it was reported that Power Financial Corp is agreeing to ante up to $30M into Wealth Simple. Interestingly, one Canadian discount brokerage appears to be capitalizing strategically on the robo-advisor trend. Robo-advisor firms WealthSimple and Wealthbar both appear to have relationships with Virtual Brokers. Virtual Brokers’ direct competitor Questrade, chose a slightly different strategy by building their own robo-advisory known as Portfolio IQ.

Given how fast technology is moving in the financial services sector, waiting and seeing is no longer something brokerages can afford to do for too long. As the influx of client assets into robo-advisors clearly demonstrates, the market is talking, the only question is how long will it take for the larger online brokerages to respond.

Event Horizon

April 26

Scotia iTRADE – Top Global Investment Themes for 2015 – Larry Berman Roadshow Edmonton, AB

April 28

NBDB – Introduction to Technical Analysis – Moving averages – [Fr]

Desjardins Online Brokerage (Disnat) – The Stockscores Approach to Active Trading

April 29

TD Direct Investing – Introduction to Investing

TD Direct Investing – Understanding Margin & Short Selling

NBDB – Tools and Technical Analysis with Michel Carignan – [Fr]

April 30

NBDB – Introduction to Technical Analysis: Oscillators – [Fr]

RBC Direct Investing – Getting Started with ETFs – Vancouver

Desjardins Online Brokerage (Disnat) – Investing With the Stockscores Approach

From the Forums:

Heading into the Close

Heading into the tax filing deadline, there are many DIY investors who are aware of or about to learn a hard lesson about the importance of record keeping. In this post from the Financial Wisdom Forum, there is a particularly instructive lesson about making sure to regularly collect/download/store transaction histories – especially when closing down accounts.

At Least the Chairs Are Comfy

There are probably no shortage of classic internet memes that could capture the experience from this post of an individual attempting to open an online trading account with TD Direct Investing in an offline setting. More and more, consumers are expecting online interactions to be easy however as online brokerages of all sizes have shown, competing IT demands tend to mean some features get priority over others. Perhaps the most interesting thing was that another online brokerage didn’t chime in to showcase their online account opening abilities.

That does it for this week’s roundup. For most folks there will be lots of hockey and/or relaxation on the menu – not so for the DIY trader at the centre of a scandal involving the great ‘flash crash’ of 2010. If you’re a Vancouverite, you might appreciate the effect that ‘spoofing’ can have (am I right Mother Nature?) with the wicked “Spring” weather going into the weekend. So, for those who choose not to venture outside, check out this interesting read on whether or not the lone trader Navinder Singh Sarao is a hero or villain.

source: Twitter

 

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Discount Brokerage Weekly Roundup – April 17, 2015

April showers are supposed to bring May flowers, but this past week, it’s been the discount brokerages who’ve been making it rain. In particular, it was the heavy hitting bank-owned brokerages that dominated the news feeds with feature enhancements, deals and more. While it may not have been quite as epic as Toronto Blue Jays outfielder Kevin Pillar’s exceptional catch, it will definitely be a week that makes the discount brokerage highlight reels.

In this week’s roundup, we take a look at a pair of makeovers from two big online brokerages. First, we look at the launch of a new investor centre in the heart of downtown Toronto by one online brokerage as well as a website facelift from a well-known bank-owned brokerage. On the heels of these two announcements were also a pair of promotional offers that caused an uptick in the deals activity this month. Finally we take a look at the upcoming investor education events as well as the chatter going on in the investor forums.

Scotia iTrade Gets Fancy

One of the big themes from brokerages this week, and this year it seems, will be stepping up their image. Earlier this week, Scotia iTrade officially launched a newer and modern-feeling investor centre in downtown Toronto.

So what was Scotia iTrade’s take on getting modern? Judging by the early pics of their new space, it’s definitely focusing on the branch experience feeling sleek and technology driven. The striking new design coupled with a high foot-traffic location means that there will be a lot of folks checking out this new eye-catching space. Users on Twitter, in fact, remarked at the new centre as it launched earlier this week.

The new investor centre is also attached to a Scotiabank banking centre, a tactical maneuver designed to demonstrate that Scotia iTrade users can easily access Scotiabank services and vice versa. For bank-owned brokerages, such as Scotia iTrade, investor centres offer their clients a familiar service expectation of being able to walk into a physical location and talk to a real-live person. Other brokerages, such as RBC Direct Investing, TD Direct Investing, Desjardins Online Brokerage and National Bank Direct Brokerage have high-visibility investor centres. Unlike the other brokerages, however, Scotia iTrade is unique in the proximity of the two centres to each other as well as the aesthetic choice.

As with their first investor centre, visitors accessing the new investor centre will be able to attend in-person investor education seminars and special events. In addition, the new centre will feature self-service stations to trade or manage their accounts.

The Power of ‘And’

Coinciding with the launch of their new investor centre, Scotia iTrade also took the opportunity to significantly raise the stakes in the ultra-competitive deals and promotions space.

Over the past year, Scotia iTrade has run a number of promotions where users could choose between receiving cash back or commission-free trades (via commission rebates). These offers have often had large headline numbers like $500 or $1000 cash back or 1000 free trades and have also required sizable deposit amounts to qualify for those bigger rebates. With the launch of the new investor centre, however, Scotia iTrade changed the OR to an AND to give individuals both the commission-free trades AND cash back.

Scotia iTrade is not the first bank-owned online brokerage to combine cash back and commission-free trades. CIBC Investor’s Edge offered this combination alongside their launch of lowered commission pricing late last year. What is different, however, is the scale of the offer from iTrade relative to what they’ve offered previously as well as what else is currently out there. There are, however, two important ‘catches’ to this offer.

First, it requires having the account being opened at one of three downtown Toronto locations – something that will certainly limit the numbers of people rushing to this offer. Secondly, unlike their other offers, the commission-free trade period for this promotion is 90 days instead of 180 days. For those seeking the cash rebate, this is actually an advantage because payouts happen much sooner, however for the commission-free trading period, it means individuals have to use up the trades much more quickly.

BMO InvestorLine Launches New Website

Scotia iTrade wasn’t the only bank-owned discount brokerage with a new look and new deal to showcase this week. BMO InvestorLine quietly launched a new front-end of their website as well as a new promotion.

The new BMO InvestorLine website is a much more modern-looking layout compared to their previous website and that of their fellow bank-owned brokerages. The top menus have been streamlined and the amount of information on the page reduced to make for a far less cluttered viewing experience. It’s also responsive meaning tablet and smartphone users can easily navigate it.

Along with the new look is also a new url. Users who enter or who click www.bmoinvestorline.com will now be redirected to www.bmo.com/self-directed. There definitely appears to be a push to highlight that online brokerage is a part of ‘wealth management’ and that InvestorLine isn’t as much the focus as is the “self-directed investor”. Gone are the close ups on calculators and cluttered papers on desks and instead there are pictures of people – and not just the cheesy couples on couches (and yes there are only a few close ups on tablets.)

Another interesting design choice is that the website looks and feels like many startup company websites rather than a traditional bank-owned entity, a definite overture to younger clients. With this layout, users can typically scroll down to find more information, there are mixtures of icons (the ‘cool’ looking ones) and big bold images. There is also far less text to grind through and far fewer pages to navigate.

Screengrab from BMO InvestorLine’s new website

While there are lots of stock images (ironically not images of stocks) they have thankfully opted for younger characters, casual settings and, interestingly, a lot more women and ethnic diversity. In fact, out of the 6 header images associated with their top level ‘self-directed’ menu, only one has a picture of just a male (the experienced investor) – a far cry from the ‘old boys club’ imagery of finance that prevailed not that long ago. BMO InvestorLine’s fellow bank-owned brokerages are not quite there yet but this is definitely something they may take some cues from.

There’s certainly lots to like about the new look however the more interesting elements are definitely the more subtle yet deliberate shifts in branding (wealth management vs InvestorLine) and the evolution of image to appear more client-focused, cosmopolitan and modern.

With Desjardins Online Brokerage’s new website launch earlier this year and now BMO InvestorLine, 2015 looks like it will be a big year for website overhauls. Interactive Brokers has also just announced they’re upgrading their website and at least three other brokerages we’ve directly spoken to are actively working on new sites for this year. So far, however, the bar has been raised fairly high and it should be interesting to see what other brokerages do in order to respond to these branding updates from the bigger bank-owned brokerages who are figuring out how to capture the feeling of ‘friendly’.

Screen grab from Interactive Brokers website.

 

All Aboard

Investors of all stripes know that timing is everything. For BMO InvestorLine launching their new website was also an opportune time to announce their newest promotion. Their latest offer, the ‘Five Star Promotion’, which is a cash back or commission-free trade promotion, continues their pursuit of clients with deposits over $100,000. There are three tiers to the latest BMO InvestorLine offer: for deposits of $100,000 – $249,999; deposits of $250,000 – $499,999 and $500,000+. Currently only Scotia iTrade and BMO InvestorLine are targeting clients with deposits over $100,000. In fact, we spotted another offer from iTrade that was linked to their investor education tour with Larry Berman which we have included in the latest deals & promotions section.

Seeking Attention

This week was a busy one for Scotia iTrade all around. In addition to the announcements of their new deals and investor centre, they also announced that they are the first online brokerage in Canada to partner with/offer financial news site Seeking Alpha to offer their premium content to clients. This move comes almost year after Scotia iTrade announced their partnership with the Financial Times to provide syndicated content to iTrade clients.

In keeping with their strategy to provide a value-added content, the content being linked through the backend offers the convenience of looking up the information from Scotia’s interface rather than having to look it up from seekingalpha.com. The information, however, appears to be freely available on seekingalpha’s website (if you are a registered user) so users can still access the articles outside of the platform. Of course the upside for iTrade is to create an experience for users that keeps their eyeballs on the iTrade platform rather than a competitors.

Event Horizon

April 18

TD Direct Investing – Introduction to Investing in Options

Scotia iTRADE – Top Global Investment Themes for 2015 – Larry Berman Roadshow Calgary, AB

April 21

Scotia iTRADE – Five Option Pitfalls: Avoid These Mistakes with Pro Market Advisors

TD Direct Investing – Technical Analysis Series, Part 2 of 2: Advanced Indicators

April 22

TD Direct Investing – Understanding Margin & Short Selling

Scotia iTRADE – Options Trading Using Technical Analysis with Montreal Exchange

April 23

Desjardins Online Brokerage (Disnat) – How I Day and Swing Trade the Market

TD Direct Investing – Introduction to Investing in Options

TD Direct Investing – Portfolio strategies Using ETFs

Scotia iTRADE – Top Global Investment Themes for 2015 – Larry Berman Roadshow Grande Prairie, AB

From the Forums

Client Relationship

The environment for fee disclosure from financial service providers is gradually improving. This post from the reddit Personal Finance subreddit provides an interesting look at how individual investors are greeting the new change.

A Green Investor

Giving an advisor the news that you’re going to do-it-yourself is not something that they generally enjoy. In this post from Canadian Money Forum, a TD Direct Investing client looks for a little collective wisdom after a not-so-graceful breakup with an advisor.

That does it for another edition of the roundup. With the Bloomberg outage, some weekends probably kicked off a bit earlier than others, however with NHL playoffs in full swing, the real work of cheering on your favourite teams begins (or in the case of Leaf & Oiler fans, cheering for their other favourite Canadian city!).

 Editor’s Note: Updated 4/18/15 to include mention of Interactive Brokers’ new website announcement which was noticed after publishing.

 

 

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Discount Brokerage Weekly Roundup – April 10, 2015

As it turns out, the launch of Game of Thrones season 5 isn’t the only epic battle around this April. While there won’t be the same kind of over-the-top fight scenes, gore or unending-memes, Canadian discount brokerages appear to be gearing up for their own fight for supremacy.

In this week’s roundup, we take a flying dragon’s eye view at the lay of the online brokerage landscape starting first with some big news about TFSAs followed by the growing movement to have better trading platforms. Following that, we take a look at which brokerage decided to hike inactivity fees, a brokerage that kicked off a competition to find the best investor in the land, as well as dark-horse entering into the investor education event space. Finally, we go to the voice of the people to find out the latest investor chatter in the land.  Brace yourselves.

Double Eh

One of the big news stories for DIY investors this past week was the hint that the Federal Government may be doubling TFSA contribution limits from $5,500 to $11,000 in the upcoming Federal Budget. While the TFSA vs RRSP debate still rages on, there are many Canadians who have fully embraced this vehicle for growing their wealth.  There are even those, to the chagrin of the CRA, who have embraced it a little too enthusiastically.  Of course the move to widen out the contribution limits of the TFSA is likely to touch off another huge wave of promotional activity from Canadian discount brokerages for whom the announcement is like an early Christmas.

Online brokerages are eagerly waiting for the confirmation before making any official announcements of their own, but it’s a likely bet that there were lots of analysts tasked with figuring out exactly what this opportunity could mean to their brokerage firm. The widened contribution limits mean additional assets through the door and perhaps a greater inclination of those with the wealth to trade it.

Trend in searches about TFSAs in Canada from 2008 – 2015 (April) -Source: Google Trends

For DIY investors there is almost certainly something else they can expect with this new announcement: a flood of marketing and advertising about TFSAs.  One of the themes we see emerging from activity around the brokerage industry this week is definitely a ratcheting up of marketing activity and the announcement of the TFSA limits being raised is like tossing gasoline onto this already growing fire.

BMO InvestorLine Looks to Click with Active Traders

In the online brokerage industry, active traders are by far the most prized. Last November, we reported on the quiet roll-out of the Market Pro platform.  Earlier today, BMO InvestorLine announced some key feature upgrades to their Market Pro platform that look like they’ve got the functionality closer to what active traders would actually demand of a performance platform.  Included in the latest updates are point and click trading of equities and options as well as real-time position and balance updates.

The platform itself is powered by Interactive Data, the same firm behind ‘eSignal’ which has variants known as Market Q (used by National Bank Direct Brokerage) and Desktop Pro (used by Jitneytrade).  From a trading perspective, users can expect to get a significant boost in functionality compared to the BMO InvestorLine web interface.  While one user’s experience doesn’t define the experience for everyone, the following user on Twitter summarizes the hazard of trying to quickly execute trades using web browser-based trading platforms.

Not only are there lots of fields to complete when executing the trade, but also other factors, such as latency make the web-based solution less than appealing. Currently, the Market Pro platform is being packaged in BMO InvestorLine’s “5 star program” which has replaced their “Active Trader” program.  Specifically, access to Market Pro is available on the Gold and Platinum star packages which require minimum trading levels of 30+ or 150+ trades per quarter respectively to qualify. In addition to this roll out, it looks like BMO InvestorLine is also going to be placing additional focus on improving their platform experience as they also have posted for a user experience (UX) designer to assist them with enhancing the experience on InvestorLine across multiple devices (desktop, tablet and smartphone).

BMO InvestorLine isn’t the only bank-owned online brokerage looking to enhance user experience with a new platform. RBC Direct Investing is also testing out the beta version of a new web-based platform (and has been since late 2014). Unlike the BMO InvestorLine Market Pro, the new RBC Direct Investing platform appears to be geared towards the ‘standard’ trader/investor and is a significant departure from their existing trading interface. In either case, however, it is clear that DIY investors are starting to see bank-owned online brokerages start to create better user experiences and interfaces.

Fee-ling the Pinch

Ever hungry for growth in revenues and shareholder value, several of Canada’s large banks have recently undertaken a wave of fee hikes for many of their banking services. Responses from frugal Canadians have been decidedly negative (see here for TD, here for BMO and here for RBC). However unpleasant, though, having banks raise fees doesn’t seem too unexpected. Not so for independent online brokerages though.

In an interesting move, Questrade has also decided to join in the fee-raising in an announcement listed in their community section. Specifically Questrade announced that they are raising their inactivity fee from $19.95 to $24.95. This announcement comes on the heels of their new myFamily plan launch, presumably to help soften the blow of the once no-fee brokerage starting to ratchet up their fees alongside the big banks.

Looking for a Big Winner

National Bank Direct Brokerage and Horizons ETFs are back at it again with the return of the ‘Biggest Winner’ online investing competition. The contest kicks off April 13th and features a top prize of $7500, a second place prize of $2500 and 6 weekly prizes of $500. The top prize will be awarded to the contestant with the highest portfolio value at the conclusion of the contest. Check out the full contest details and rules here.

Event Horizon

The investor education section looks like it might start to get just a bit more crowded with the entrance of a newer player to the field. RBC Direct Investing, which has held orientation seminars at its investor centres in Toronto, Calgary and Vancouver, is now starting to offer sessions on ETF investing with educational partner iShares. Sessions will be featured on the investor education calendar and the event horizon later on this month. Also on the horizon this week is a webinar from TD Direct Investing and the Montreal Exchange on Options Trading Mistakes to Avoid (April 15).

April 11

Desjardins Online Brokerage (Disnat) – When To Sell – Common Signals That the Trend is Turning

April 12

Scotia iTRADE – Top Global Investment Themes for 2015 – Larry Berman Roadshow Toronto, ON

April 14

Scotia iTRADE – Build a Low Cost and Efficient Portfolio Using ETFs with Horizons ETFs

NBDB – Introduction to Technical Analysis: Trends – [Fr]

April 15

TD Direct Investing – Introduction to Investing

Scotia iTRADE – Generating Income Using ETFs with iShares

TD Direct Investing – Investing Idea: An Introduction to REITs

April 16

NBDB – Introduction to Technical Analysis : Supports and Resistances – [Fr] 

Scotia iTRADE – Advanced Options Strategies and Technical Analysis with AJ Monte 

TD Direct Investing – Introduction to Fundamental Analysis 

Desjardins Online Brokerage (Disnat) – Finding Position Trades With the Stockscores Approach

From the Forums

Boldly Going

TFSAs are set to boldly go where they have never gone before.  In this post from the Canadian Money Forum, the rumoured raising of the TFSA contribution limit has also raised the spirits of many DIY investors.  Check out what they had to say here.

Once Upon an RRSP

There are often times folks find themselves not exactly clear on how it is an RRSP actually works.  In the following thread from the reddit Personal Finance Canada thread, there are a number of interesting analogies and explanations of how these plans save investors money and what happens at retirement. That’s a wrap for this week’s roundup.  Don’t forget to get out from behind the screen to enjoy the spring weather or at the very least start using those new emojis to describe what you see!  Have an ☀️✌

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Discount Brokerage Weekly Roundup – April 3, 2015

While markets shut down early for the Easter weekend, those in the markets are all too familiar with the feeling of hunting for the analogous Easter eggs and being careful with how many they have in any one basket. Interestingly, the prizes and family time that have come to characterize Easter also seem to have inspired Canadian discount brokerages going into this long weekend.

In this week’s roundup we take a look at the latest basket of discount brokerage deals to cross our radar followed by a mind-blowing marketing move by one online brokerage. Next we hop on over to the upcoming investor education events and cap off the week with some timely investor forum chatter.

Ears to the Ground for Deals

This past week, the flurry of RSP-linked investing account offers from online brokerages officially came to an end. The end of March signaled the expiry of 10 deals from brokerages large and small. Players such as RBC Direct Investing, TD Direct Investing, HSBC InvestDirect and National Bank Direct Brokerage all had deals wrap up.

Those looking for a deal on an online brokerage account needn’t worry, however, as there are still 15 offers from 7 brokerages.

Stepping into April, there are a few noteworthy developments in the deals/promotions space. First, after a brief hiatus from the deals section, Virtual Brokers has decided to rejoin the promotions roster offering up a deal that looks to challenge other brokerages to a test of endurance.

The latest deal from Virtual Brokers consists of 25 commission-free stock or ETF trades which are good for use for up to one year. Most discount brokerages have commission-free trading offers that last between 30 and 90 days. Some of the exceptions include Desjardins Online Brokerage whose commission credit lasts 6 months or Questrade who has a $50 commission credit with no expiry date.   The offer itself is similar to the recently expired RBC Direct Investing promotion which offered 20 commission-free trades which were also good for up to one year.

Offers with 100 or 500 commission-free trades might be great for highly active traders but would offer little value for less active investors which makes the latest move by Virtual Brokers DIY investors may turn to, especially with RBC Direct Investing’s offer now retired.

Another interesting development in the deals/promotions section was a raising of the ante by Desjardins Online Brokerage. Since October of 2012, they have been offering a $300 commission credit (on a minimum deposit of $50,000), however this month they have decided to raise the stakes by increasing this offer to a $500 commission credit.

For some context, the only other (current) offer of a $500 commission rebate is from Scotia iTrade which requires a minimum deposit of $500,000. The move may be a response to the recently expired promotion from National Bank Direct Brokerage (a key competitor to Desjardins Online Brokerage) who was offering $500 in commission rebates for deposits of at least $20,000. What makes Desjardins’ latest offer interesting is the combination of dollar amount and time to take advantage of the offer. The Desjardins Online Brokerage commission credit is good for up to 6 months, a timeframe (as mentioned above) that is far longer than most other commission credits currently available.

Finally, it’s also worth mentioning that Qtrade Investor has lowered the threshold to try out their online brokerage for individuals with less than $25,000. They currently have a transfer fee credit (of up to $150) for individuals depositing at least $10,000 (which is lower than their normal threshold of $25,000).

On a relative basis, having several deals at the start of the month is a sign that competition is ratcheting up going into the income-tax deadline season. While the bigger players have largely stepped back (for now), if and when they do step back in, it will have to be with even larger offers, which is another great piece of news for DIY investors.

Questrade Launches myFamily Program, Drops Mic

While Questrade remains the most active online brokerage in Canada to offer deals and promotions, they are also no stranger to getting creative to win new clients and loyalty from existing ones. Their latest salvo in the online brokerage competition, known as the myFamily Program, may just cause a tear in the financial services space-time fabric. Seriously.

Before jumping to why Questrade’s latest move may cause other Canadian discount brokerages to hit the panic button, it’s worthwhile to provide a bit of context.

Those who actively follow Questrade (and remember a time when there were NO inactivity fees) will recollect the moment that they introduced inactivity fees and the lengths that they went to then make it possible for clients to have those fees waived. One of the key components to the inactivity fee being waived is retaining a minimum balance of at least $5,000. While that threshold is low on a relative basis, for many younger or newer investors, it can still represent a barrier to getting into investing. This past week, however, meeting this threshold just got much simpler.

The recently announced myFamily Program from Questrade enables clients to reach that threshold by pooling the combined assets from up to five other Questrade clients – anywhere.

This is a big deal because historically, while there have been programs that have enabled clients to combine personal assets across other accounts with the same provider Questrade’s myFamily program crosses the threshold by linking individuals who just want to be linked together. For example, Scotia iTrade enables clients with combined assets of at least $50,000 across all Scotiabank services to qualify for $9.99/trade pricing and CIBC Investor’s Edge has enabled different individuals within the same household to pool assets or trading activity, however adding different people from (potentially) different addresses to a group in order to form a pool is not something other brokerages offer.

Screen grab from description of myFamily program from Questrade website.

According to Questrade, the definition of “family” is “who you tell us it is.” Not only is this an exceptionally enlightened way to characterize a family in 2015, but it is also brilliant from a marketing and business development perspective. Questrade has demonstrated on many occasions how to get people to start talking about them (for better or worse), however they’ve also shown how to get people to like them.

The $5,000 minimum asset threshold is a modest bar to lower from a fee perspective. The bigger prize, however, is the fact is that Questrade has redrawn the map on getting individuals to find other individuals to join Questrade (e.g. client acquisition) and also have them stay (e.g. client retention) and also champion the brand (e.g. advocacy).

They have created a way to leverage the power of sharing in a world that increasingly wants to share everything (like lunch pics and selfies) and with a demographic of individuals who absolutely buy into sharing. More than that, they’ve shown that do-it-yourself investors can get ahead by doing something together.

Your move every other online brokerage.

Event Horizon:

April 7:

NBDB – Learn About Investment Basics – [Fr]

Scotia iTRADE – Volatility – Friend or Foe with Pro Market Advisors

April 8:

Scotia iTRADE – Options as a Hedging Strategy Using Put Options with Montreal Exchange

TD Direct Investing – Options as an Income Strategy

TD Direct Investing – Economic Update & Introduction to Fixed Income

Desjardins Online Brokerage (Disnat) – How to Analyze Any Stock or Market in 10 Seconds

NBDB – Tools and Technical Analysis with Michel Carignan – [Fr]

April 9:

TD Direct investing – Options as an Income Strategy

TD Direct Investing – Technical Analysis Series, Part 1 of 2: Candlestick Charting

From the Forums

Withhold your applause

While there are countless articles discussing the pros and cons of RRSPs vs TFSAs, the following post from the RedFlagDeals.com investing forum provides an interesting perspective on the unwinding of an RRSP account with an online brokerage and some of the hard lessons learned.

Slip and Slide

Tax slips and low-cost brokerages seem to be a hit and miss exercise. Here are a couple of conversations about receiving those all-important summaries from investors on different boards (talking about Questrade and Virtual Brokers).

 

That does it for this holiday edition of the roundup. While markets will be back up and rolling on Monday, here is an entertaining look what the President of the United States will be up to and how the Easter Bunny gets VIP access to the White House. Not ‘egg-sactly’ what Frank Underwood would do…Have a great weekend!

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Discount Brokerage Deals and Promotions – April 2015

*Updated April 17* At the outset of April, there’s lots of deals and promotions activity to report on. Like most people, Canadian discount brokerages have done quite a bit of ‘Spring cleaning’ with their deals. For those looking to open an online trading account, this month has a number of interesting offers to consider.

RSP season was a big catalyst for many brokerages which resulted in an all-time high number of deals (25+) being offered through February and dropping to 15 by the end of March. With many of those offers set to expire at the end of March, we weren’t sure which would live to see another day and which would expire, however as March drew to a close, at least a handful of offers started to show signs of being continued, albeit briefly.

While it looks like many of the biggest brokerages are taking a breather, other brokerages are seizing that chance to step up. Some of the independent and less well-known brokerages, for example, are launching promotions that are sure to get the attention of self-directed investors as well as the larger brokerages.

April begins with 15 deals being offered by 7 different brokerages. There are two offers set to expire within the month, and three more by the end of the month. As has been the case with most deals and promotions, the number of deals at the beginning of the month is likely not going to be the same at the end.

Expired Deals

There were 10 discount brokerage promotions that expired in March. Many of these offers were extensions of offers initially launched as incentives during “RSP season” as well as one offer from Questrade that was timed around the Chinese/Lunar New Year.

Notably, RBC Direct Investing and TD Direct Investing left the deals field (for now) at the end of March. Also, National Bank Direct Brokerage closed out its rather sizeable offer as March ended.  Desjardins Online Brokerage technically saw the expiry of its over three year old $300 commission offer however another (larger) offer has replaced it.

Below is a list of the offers that expired within or at the end of March 2015:

  • HSBC InvestDirect            50 commission-free trades
  • Questrade          Unlimited Trading Offer
  • Questrade          Unlimited Trading Offer RSP
  • Questrade          Chinese New Year Promotion
  • Scotia iTrade      Cash back + Free Trade Offer
  • RBC Direct Investing       20 Free Trades
  • NBDB    $500/$1000 Commission Rebate
  • TD Direct Investing          200 Free Trade Offer
  • Disnat   $300 Commission Credit
  • Questrade          iPad Mini Offer

Qtrade’s RSP contest promotion also concluded at the end of March.

Extended Deals

Just before the end of March, BMO InvestorLine extended the deadlines for two of its currently advertised promotions.  Their Youth Promotion was extended once again, this time with the expiry date now bumped to April 30th.  Interestingly, the RSP promotion was also extended for another two weeks with the new deadline for this offer moved to April 15th.

New Deals

*Updated April 17* It’s been a busy week for discount brokerages launching their new looks and celebrating the events with new deals. BMO InvestorLine rolled out their new public facing website this week and with it they also launched a new promotion offering either a cash back or commission-free trading choice.  Their latest offer requires asset deposits of at least $100,000 to be eligible for either $250 cash back or 125 commission-free trades.  The other tiers for this offer include: depositing between $250,000 – $499,999 to receive $500 cash back or 250 commission-free trades; depositing $500,000+ to receive either $1000 cash back or 500 commission-free trades. See table below for further details.

Another promotion crossed our radar this week that was not advertised but is open to all.  The promotion is a cash back or commission-free trade offer from Scotia iTrade and has been part of their tour with Larry Berman. The offer itself is similar to previous (and current) offers except that there are more deposit tiers and correspondingly different cash back and commission-free trade amounts. Interestingly, because it provides a longer time horizon to use the commission-free trades, it is slightly more competitive an offer than the current BMO InvestorLine offer, however the flip side is that cash back rebates will take slightly longer.  A scan of the terms and conditions has been taken since no information was posted online, however for more information on this offer be sure to contact Scotia iTrade directly.  See table below for further details.

*Updated April 13* To celebrate the launch of their new Investor Information Centre in downtown Toronto, Scotia iTrade has taken the interesting step of launching a substantial promotional offer alongside a similar promotion. The newest offer, however, trumps the existing promotion hands down.  In their latest promotion (open to both new and existing clients) Scotia iTrade is combining free trades AND cash back as part of this latest incentive (the other promotion requires that individuals choose free trades OR commission-free trades).

Specifically, individuals depositing $15,000 – $49,999 can receive $75 cash AND 75 free trades; individuals depositing $50,000 – $99,999 can receive $125 cash AND 125 free trades; individuals depositing $100,000 – $249,999 can receive $250 cash AND 250 free trades; and individuals depositing $250,000 or more can receive $500 AND 500 free trades.   The biggest ‘catch’ to the is offer, according to the terms and conditions, is that individuals must open the account at one of three specific locations in downtown Toronto.  Here is the quote from the terms and conditions:

To qualify for this offer, new Scotia iTRADE account must be opened at one of the following locations: Scotia Plaza Banking Branch, 40 King Street W, Toronto, ON, M5H 1H1; Scotia iTRADE Investor Information Centre at 48 Yonge Street, Toronto, ON, M5E 1G6; or Scotia iTRADE Investor Information Centre at Scotia Plaza, Concourse Level, Suite CAB001, 44 King Street W, Toronto, ON, M5H 1H1.

For more information and details on this deal, see the table below.

This month there are four new commission-free trade or cash back offers and a new transfer fee promotion.

Virtual Brokers has stepped back into the deals arena after a month-long break with an offer that is sure to get other brokerages’ attention. Their latest deal offers 25 commission-free stock or ETF trades which are good for up to a year – far longer than most of the offers currently on the deals and promotions list.

Although Scotia iTrade retired their largest offer yet, they have brought back two other offers in its place. First, their $500 or 500 free trade offer. Scotia iTrade still remains one of the only brokerages to be targeting deposit sizes of over $500,000.  The other offer making a comeback is the 100 free trade offer (which also includes a trial offer to their trading platform FlightDesk).

Desjardins Online Brokerage’s latest offer, however, is going to raise a few eyebrows.  Their long standing offer of $300 in commission credits has been replaced with a $500 commission credit offer for deposits of $50,000 or more in assets. This is an attention grabbing number as comparable offers require deposit sizes of at least $500,000 (e.g. Scotia iTrade).  Drilling down into the fine print, however, this offer combines the transfer credit (of up to $150) as well as commission-free credits.  Thus, for individuals switching brokerages to Desjardins Online Brokerage it may be closer to $350 in commission credits if the full transfer fee has to be covered.  Of course, for those thinking of switching, it is worth requesting or negotiating that the brokerage cover all of the transfer fees as well as offer the full credit ($500) which could then make this offer stand head-and-shoulders above the others currently being offered for the $50,000+ deposit category.

While technically not initiated at the beginning of April, Questrade introduced a new version of their prepaid Visa offer midway through March.  This latest offer has up to a $250 prepaid Visa card for deposits of $100,000 or more (there are lower prepaid Visa card amounts available for smaller deposit sizes too).

Finally, Qtrade Investor is offering a new transfer fee rebate offer in which individuals who switch to Qtrade with at least $10,000 can have up to $150 in transfer fees covered.  Although this is a limited time offer, it is the lowest deposit amount required to qualify for that level of transfer fee coverage.

Discount Brokerage Deals

Company Brief Description Minimum Deposit Amount Commission/Cash Offer/Promotion Type Time Limit to Use Commission/Cash Offer Details Link Deadline
Jitney Trade A Sparx Trading exclusive offer! Use the promo code “Sparx Trading” when signing up for a new account with Jitney and receive access to their preferred pricing package and a massive 45% discount on the Real Tick trading platform. n/a Discounted Commission Rates none For more details click here none
BMO InvestorLine For individuals between 18 and 35 who open a new qualifying account with BMO Investorline, they may be eligible to receive 35 commission-free trades, an eBook on investing and potentially waived account minimum fees. Use promo code “New” when signing up. Be sure to read the terms and conditions for more details on the offer. n/a 35 commission-free trades 90 days Youth Promotion April 30, 2015
Open a new account (TFSA, Margin or RRSP) and receive $50 commission credit . Use promo code: kdkfnbbc $1,000 $50 commission credit none none none
Refer a friend to Questrade and when they open an account you receive $100 and they receive $50. To receive this deal you must be an existing client with an equity account and refer a person that does not reside with you and who has not previously opened a Questrade account. $1,000 $50 commission credit (friend) $100 commission credit (referrer bonus) 60 days Refer a friend none
Open a new account (TFSA, margin or registered account) with Questrade and deposit at least A)$1,000 or B)$10,000 and you may be eligible to receive A)10 commission-free trades or B)100 commission-free trades. Use promo code 100LOWCOM15Q3 when registering. Be sure to read the full terms and conditions for this offer. A)$1,000 B)$10,000 A) 10 commission-free trades B) 100 commission-free trades 60 days 100 free trades offer May 29, 2015
Open a new account (TFSA, margin or registered account) with Questrade and deposit at least A)$5,000; B)$25,000; C)$50,000 or D)$100,000 in order to be eligible to qualify for a Visa gift card in the amount of A) $50; B) $75; C)$100 or D)$250. Clients must also place at least one commission-generating trade within 60 days. Use promo code VISA250 when signing up. Be sure to read terms and conditions for full details. A)$5,000 B)$25,000 C)$50,000 D)$100,000 A) $50 prepaid Visa card B) $75 prepaid Visa card C) $100 prepaid Visa card D) $250 prepaid Visa card Prepaid Visa cards may be issued up to 40 days after eligibility confirmed Prepaid Visa Promotion May 18, 2015
Open a new TFSA, margin or registered account with Questrade and deposit at least $10,000 dollars to be eligible to receive 100 commission-free trades and a three month subscription to Motley Fool Stock Advisor Canada newsletter. Use promo code 100FREEMFSUBwhen signing up. Be sure to read the terms and conditions for more information. $10,000 100 commission-free trades 60 days Motley Fool Subscription Promotion April 30, 2015
Scotia iTrade If you refer a friend/family member who is not already a Scotia iTrade account holder to them, both you and your friend get a bonus of either cash or free trades. You have to use the referral form to pass along your info as well as your friend/family members’ contact info in order to qualify. There are lots of details/conditions to this deal so be sure to read the details link. A)$10,000 B)$50,000+ A) You(referrer): $50 or 10 free trades; Your “Friend”: $50 or 10 free trades (max total value:$99.90) B) You(referrer): $100 cash or 50 free trades; Your “Friend”: $100 cash or 50 free trades (max total value: $499.50) 60 days Refer A Friend to Scotia iTrade June 30, 2015
Scotia iTrade Open and fund a new Scotia iTRADE account with at least A) $15,000 – $49,999; B)$50,000 – $99,999 C)$100,000 – $249,999; or D)$250,000+ and you may be eligible to receive a corresponding cash-back AND commission rebate. New clients use code GO15 when opening the account. Note: Only accounts opened at one of the three downtown Toronto locations specified can qualify for this promotion. Be sure to read the terms and conditions carefully for rebate and cash back eligibility. A)$15,000 – $49,999 B)$50,000 – $99,999 C)$100,000 – $249,000 D)$250,000+ A) $75 cash back AND 75 commission-free trades B) $125 cash back AND 1255 commission-free trades C) $250 cash back AND 250 commission-free trades D) $500 cash back AND 500 commission-free trades 90 days for commission-free trades. Cash back to be deposited by August 31, 2015. Cash back AND commission-free trade offer May 31, 2015
Open and fund a new account at Virtual Brokers with at least $15,000 and you could be eligible to receive up to 25 commission-free stock or ETF trades good for use for up to one year. Use promo code “TRYUS2015” when signing up to qualify. Be sure to read full terms and conditions carefully. $15,000 25 commission-free trades 365 days Free trades for one year promotion May 31, 2015
Scotia iTrade Open and fund a new Scotia iTRADE account with at least A) $15,000 – $99,999, B)$100,000 – $499,999, C)$500,000+ and you may be eligible to receive a corresponding cash-back or commission rebate. For commission-free trades use code: PST15 or for cash rebates use code: CSINE. Be sure to read the terms and conditions carefully for rebate and cash back eligibility. A)$15,000 – $99,999 B)$100,000 – $499,999 C)$500,000+ A) 100 commission-free trades OR $50 cash B) 250 commission-free trades OR $250 cash C) 500 commission-free trades or $500 cash 180 days for commission-free trades Cash back to be deposited by February 17, 2016. 500 Free Trade or $500 Cash Back Offer May 17, 2015
Scotia iTrade Open and fund a new Scotia iTRADE account with at least A) $15,000 – $49,999; B) $50,000 -$99,999; C)$100,000 – $249,999; D)$250,000 – $499,999; E) $500,000 – $999,999 or F)$1,000,000+ you may be eligible to receive a corresponding cash back or commission rebate. For commission-free trades use code: LBS15FT or for cash rebates use code: LBS15C. Be sure to read the terms and conditions carefully for rebate and cash back eligibility. Contact Scotia iTRADE for full details on this offer. A) $15,000 – $49,999 B) $50,000 -$99,999 C) $100,000 – $249,999 D) $250,000 – $499,999 E) $500,000 – $999,999 F) $1,000,000+ A) 50 commission-free trades OR $50 cash back B) 100 commission-free trades OR $100 cash back C) 250 commission free trades OR $250 cash back D) 350 commission-free trades OR $350 cash back E) 500 commission-free trades OR $500 cash back F) 1000 commission-free trades OR $1,000 cash back 180 days for commission-free trades Cash back to be deposited by January 31, 2016. Larry Berman Seminar Offer – Front and Terms & Conditions May 31, 2015
Scotia iTrade Open a new Scotia iTRADE account with at least $15,000 by June 30, 2015 and you could be eligible to receive up to 100 online trades commission-free (equities, options, ETFs). Use promo code HUN-SP when registering to qualify. Be sure to carefully read full terms and conditions. $15,000 100 commission-free trades (+ free trial of FightDesk platform for 60 days) 60 days 100 Free Trades Offer June 30, 2015
Disnat Disnat is offering new & existing clients $500 in commission credits which can be used for up to 6 months. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1-866-873-7103 and mention promo code Disnat500. See details link for more info. $50,000 $500 commission credit 6 months Disnat $500 Commission Credit Promo June 30, 2015
BMO InvestorLine If you refer a new client to BMO InvestorLine and they open an account with a)$50,000 – $249,999 or b)$250,000+ the referrer and the referee will both receive cash. The new account must be opened with the referral code specific to the referrer. A) $50,000 – $249,999 B) $250,000+ A) You(referrer): $200; Your Friend(referee): $50 B) You(referrer): $300; Your Friend: $100 Payout occurs after 60 days (subject to conditions). BMO InvestorLine Refer-a-Friend October 30, 2015
BMO InvestorLine Open and fund a new qualifying account at BMO InvestorLine with at least A)$100,000 – $249,999; B)$250,000 – $499,999 or C)$500,000+ in net new assets and you may be eligible to receive either: A)$250 cash back OR 125 commission-free trades; B) $500 cash back OR 250 commission-free trades; C)$1000 or 500 commission-free trades. Use promo code 5CASH for cash back promotion or 5TRADE for commission-free trade promo. Be sure to read full terms and conditions for eligibility and further details. A) $100,000 – $249,999 B) $250,000 – $499,999 C) $500,000+ A) $250 cash back OR 125 commission-free trades B) $500 cash back OR 250 commission-free trades C) $1000 or 500 commission-free trades. Cash back: 6 months – 7.5 months Commission-free trades: 90 days (note: commission fees rebated within 45 days after 6 month credit period) Five Star Promotion June 30, 2015
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Open a new account with Credential Direct and fund it with at least A) $25,000 B)$100,000 or C)$500,00+ to receive either A) 100 commission-free trades or $100 cash back; B) 200 commission-free trades or $200 cash back or C) unlimited commission- free trades or $500 cash back. Be sure to read terms and conditions for full details. A)$25,000 – $99,999 B)$100,000 – $499,999 C)$500,000+ A) 100 commission-free trade or $100 cash back B) 200 commission-free trades or $200 cash back C) Unlimited commission-free trade or $500 cash back Trades must be used by September 30, 2015 and will be reimbursed on October 15 2015. Cash back deposited October 15, 2015. Credential Direct Spring Promotion April 15, 2015 *expired*
BMO InvestorLine Open and fund a new qualifying account at BMO InvestorLine with at least $100,000 in net new assets and you may be eligible to receive $300 cash back. Use the promo code RSP2015 when signing up for the account. Be sure to read full terms and conditions for eligibility and further details. $100,000 $300 cash back Payout occurs after 6 months RSP 2015 Promotion April 15, 2015 *expired*
Last Updated: April 17, 2015 2:30pm PT

Transfer Fee Deals

Company Brief Description Maximum Transfer Fee Coverage Amount Minimum Deposit Amount for Transfer Fee Eligibility Details Link Deadline
Qtrade Investor Qtrade Investor will reimburse your transfer fee up to $150 when transferring a balance of $10,000 or more. For reimbursement, please mail or fax a copy of your statement from the transferring institution that shows the transfer charge to Qtrade Investor at 604.484.2627 and indicate your Qtrade Investor account number. $150 $10,000 Transfer Fee Promo April 30, 2015
Scotia iTrade Transfer $15,000 or more to Scotia iTrade from another Canadian brokerage, and iTrade may pay up to $150 in transfer fees. $150 $15,000 500 Free Trade or $500 Cash Back Offer May 17, 2015
Transfer $15,000 or more to RBC Direct Investing and they will pay up to $135 in transfer fees $135 $15,000 Transfer Fee Rebate Details none
Transfer $25,000 or more from another brokerage and Credential Direct will cover up to $150 in transfer fees. Use promo code SWITCHME when signing up to qualify for the transfer promotion. $150 $25,000 Credential Direct Spring Promotion April 15, 2015
Move your brokerage account to Questrade and they’ll cover the transfer-out fee up to $150. $150 $25,000 Transfer Fee Promo none
Transfer $25,000 or more into a CIBC Investor’s Edge account and they will reimburse up to $135 in brokerage transfer fees. Clients must call customer service to request rebate after transfer made. $135 $25,000 confirmed with reps. Contact client service for more info (1-800-567-3343) none
Transfer $25,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees $135 $25,000 Transfer Fee Rebate none
Disnat Disnat is offering up to $150 to cover the cost of transfer fees from another institution. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1-866-873-7103 and mention promo code Disnat500. See details link for more info. $150 $50,000 Disnat $500 Commission Credit Promo June 30, 2015